While Bitcoin [BTC] takes the cake as the principled cryptocurrency
in the eyes of ardent decentralized currency enthusiasts, XRP vies for
the spot of the banking currency of the future. Ripple’s popularity
among the world’s top financiers is reflected by its slew of
integrations. Now, one of the world’s top exchanges has pegged the
second largest altcoin in the market as being the most diversified.

The latest piece of research
from Binance’s analysis wing in their series of “Categorizing
Cryptoassets” tackles the correlation between top digital assets, on the
basis of weekly returns. Ripple’s XRP was found to be the “best
diversified,” albeit among cryptos with a market cap over $3 billion, of
which there are only seven.

Clusters
were predominant among coins with common affinities based on geography,
purpose and exchange effect. Coins like Cardano [ADA], Neo [NEO], Qtum
[QTUM], OmiseGo [OMG], are common among coin hodlers based in Asia.
Similarly, XRP, Basic Attention Token [BAT] and Dogecoin [DOGE] are
clustered as they are US-centric.

Monero [XMR], DASH, Stellar Lumens [XLM] and NEM form a payments system cluster, stated the report.

Other clusters form due to exchange listings, citing the recent
Coinbase listing of XRP, BAT and Zcash [ZEC], and Hardfork clusters,
grouping Bitcoin Cash [BCH], Bitcoin Gold [BTG] and more.

Bitcoin and Ethereum [ETH] exhibited the highest correlation,
indicating the individual importance of the largest cryptocurrency and
the largest altcoin in the market. The report added that the market and
the two leading virtual currencies tend to follow a similar trend.

The weekly return correlation matrix which tracked the correlation
between the top-30 digital assets on the basis of 30-day mean market
capitalization on 31 March 2019 found XRP, Dogecoin [DOGE], and Tezos
[XTZ] to be standing apart from the market. Across a one-year period,
these coins exhibited the least correlation.

Binance Research added,

Ripple is less correlated in the long-term than what our
previous analysis suggested across several 3-month time-periods, using
daily returns.”

On the flipside, XRP is “highly correlated” with Stellar Lumens, its
touted rival in the banking settlements fray, owing to the latter’s
recent partnership with IBM. The report references a similarity in
objectives as being the prime reason for their price correlation,
further highlighting the “cluster” example.

Further, in light of their March 20 report, the correlation drawn out by the current report shows an increase in corresponding price changes. The reason for the same, as per the report, may be “due to the rise of stablecoin volume” and the “increase in pair offerings” across all markets.

About

The eCoin is a media that intended to deliver news and information related to the cryptocurrency and Bitcoin market.
#Cryptocurrencies #Bitcoin #Ethereum #Ripple #ICOs #Blackchain

Enter your email here to subscribe

Disclaimer

Neither the author nor the publication assumes any responsibility or liability for any investments, profits, or losses made as a result of this information. Cryptocurrency trading and investing are risky propositions, and market participants are advised to always conduct thorough research.